Why Google Wants Motorola

Why Google Wants Motorola

With input from Google, these sorts of modifications could get more juice—and might feature Google products more prominently. Motoblur, for example, might get an extra shot of Google+ integration.

“Google already had a big role to play in 50 percent of the smart phones being sold,” says technology and strategy consultant Chetan Sharma, president of Chetan Sharma Consulting. If Google uses the Motorola acquisition to grow the Android platform further, he says, “it is quite likely that their share will get to the 70 to 75 percent range. Essentially, this means they will have a huge say in how the mobile Internet is developed and implemented by the [manufacturers].”

Page also pointed to Motorola’s expertise with other Web-connected devices found around the home, saying, “I think there’s an opportunity to accelerate innovation in the home business by working together with the cable and telco industry as we go through a transition to Internet protocol.”

Sanjay Jha, chairman and CEO of Motorola Mobility, agreed, saying, “Our home business is uniquely positioned to capitalize on the convergence of mobile and home environments in partnership with our key customer.”

Google executives have stressed that the acquisition will not put other manufacturers of Android devices at a disadvantage. Google worked with HTC to build its Nexus One smart phone, and with Samsung to build the Nexus S. The company says Motorola Mobility will operate as a separate company and will have to bid for contracts to make future Nexus phones, just like everyone else.

Other smart-phone manufacturers support the deal as a way to protect Android against patent lawsuits, and Google has posted quotes from them online. HTC issued a statement that said, “This is a positive development to the Android ecosystem, which we believe is beneficial to HTC’s promotion of Android phones. The partnership between HTC and Google remains strong and will not be affected by this acquisition.”

Even so, Google may struggle to counter the perception that Motorola Mobility will get special privileges with Android. Sharma believes Google will eventually have to do more to placate other manufacturers if Android is to remain popular. “Long-term, I feel Google will divest the hardware business, and thus it will be less of a threat to the likes of Samsung and HTC,” he says.